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Negative gearing calculator.

A property is negatively geared when its costs, mostly loan interest, are more than the rent it earns. The shortfall can be deducted from your other taxable income, which lowers your tax bill and softens the cost. This calculator shows the cash flow before tax, the tax you save (or the extra you owe if the property makes a profit) and the real weekly cost or surplus that is left.

Your taxable income before this property

Salary and any other income, after your usual deductions.

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How this calculator works.

  1. Annual rent is the weekly rent times 52. Interest is the loan times the interest rate, assuming interest-only. Principal repayments are not deductible and are not included.
  2. Cash flow before tax is the rent less interest and running costs. Depreciation is a deduction that costs you no cash, so it counts only in the tax step.
  3. Tax is worked out twice on your own income, with and without the property, using 2026–27 resident rates, the low income offset and the 2% Medicare levy. The difference is the tax saved, or the extra tax paid on a profit.
  4. Cash flow after tax is the cash flow before tax plus the tax saved. Dividing by 52 gives the weekly figure.

What it assumes

  • Tax: 2026–27 resident rates (0% to $18,200, 15% to $45,000, 30% to $135,000, 37% to $190,000 and 45% above), the 2% Medicare levy and the low income tax offset (up to $700).
  • The starting scenario is $120,000 of other taxable income, an interest-only loan of $600,000 at 6.44% (the RBA average new variable rate for Jul 2026, adjusted for the 30 Sep rise), $550 a week in rent and $6,000 a year in running costs.
  • HELP debt, the Medicare levy surcharge, land tax and capital gains tax are not modelled.
  • Assumptions last reviewed 25 September 2026.

Questions people ask.

What is negative gearing?

It is owning an investment property whose deductible costs, mostly loan interest, are more than the rent it earns. The loss can generally be deducted from your other taxable income, which reduces the tax you pay.

How much tax do I save from negative gearing?

You get back your tax rate on the loss, not the loss itself. With the starting numbers, a $16,040 tax loss saves about $5,133 in tax, so the property still costs about $10,907 a year out of pocket, or $210 a week.

What is positive gearing?

A property is positively geared when the rent is more than its costs. The profit is added to your taxable income, so you pay tax on it. The calculator shows the extra tax when your inputs make the property positively geared.

What is depreciation and why does it matter?

Depreciation is a tax deduction for the wear and tear of the building and its fittings. It costs you no cash, so it lowers your tax without changing your bank balance. Which items can be claimed depends on the property and when you bought it, so get a schedule from a quantity surveyor and check it with your accountant.

Are loan principal repayments tax deductible?

No. Only the interest on an investment loan is generally deductible. Repaying principal builds your equity but is not a deduction, which is why this calculator leaves it out of the cash flow.

Is negative gearing worth it?

The calculator cannot say. Negative gearing is a tax effect, not a reason to buy on its own: you are out of pocket every year, and it only pays off if the property’s value grows by more than your after-tax costs. Speak to a licensed adviser and an accountant before relying on it.

More calculators.

Negative Gearing Calculator | Siare